One of the bigger disappointments of the last 5 years. These guys have a unique offering and a seemingly great competitive advantage yet poor management has left these guys out in the cold. Management's goal of better than $400 million in revenue by 2015 is optimistic for sure; I just don't see any reasons why this stock outperforms the market. I called it out on Investor Beat as such.

Present changes (movement to online and other related changes) will pay off, but it will likely take 12 to 24 months for there to be any significant positive improvements in bottom line. There may be some increase in stock price in the next year though if it starts to look like changes are taking effect.

Rosetta Stone is doing the right thing now - reducing prices and starting to rely on subscription revenue. One can now subscribe and use the product over the 'net from anywhere at a very reasonable monthly cost.

As a user of RST myself i find it a bit cumbersome and it actually pressures one to stay on a timeline. That fact has caused me to halt using it for the time being - my schedule doesn't allow me such luxury.

Rosetta Stone is a very tempting stock for me, I almost became a shareholder. But I believe that their product is simply too much of a luxury good to fulfill high expectations. However, I do believe that with their superior offerings, they will streamline and adapt and become profitable eventually. Management must stabilize though.

Rosetta Stone has a store in the Short Hills Mall in New Jersey that always appears empty, even as the Apple store next door teems with traffic. This store simply can't be making money for Rosetta Stone. Why do they keep it open year after year?